Trade Hopes Lift Market Sentiment

• Markets rallied on news of a US-Japan trade agreement, with tariffs set at 15%, lower than the initially threatened 25%. The inclusion of autos in the deal marks a notable win for Japanese exporters.
• Hopes for a similar US-EU agreement added to the positive tone, with markets encouraged by reports that a matching 15% tariff structure could be adopted.
• US Treasury yields climbed, led by a 5bp rise in the 10-year to 4.38%, as risk sentiment improved, and investors reassessed the global trade outlook.
• Today, RBA Governor Bullock delivers the annual Anika Foundation speech on ‘The RBA’s Dual Mandate – Inflation and Employment.’ These speeches have historically provided key insights into the policy outlook.